2023-08-13 20:06:48
Barcelona First case: a year ago a family paid 910 euros for their mortgage; With the updating of the loan, he has gone on to pay 1,390. Second case: an individual paid 687 euros for the mortgage in June, which has become 858 euros in the August installment. Third case: a family paid 1,409 euros up to now, and already knows that next month it will pay 1,732. The casuistry is inexhaustible in a country, Spain, with more than four million mortgages indexed at a variable rate, which means that, on average, 200,000 families each month have discovered throughout 2023 that the loan has become more expensive and that they will have more trouble making ends meet if they want to maintain their standard of living.
Perhaps this explains the avalanche of mortgage changes that has been taking place in recent times. A few weeks ago, an office manager from one of the large Spanish banks explained that the rate is so high that the entities have subcontracted agencies to which they grant powers to sign the changes. But the volume is so high that it has become common for directors of offices close to notaries, as was his case, to be called urgently when these agencies cannot attend to a signature before the notary.
Different data reflect this increase. In the first five months of this year, the mortgages that have changed their conditions amount to 57,586 cases, when in the last five months of 2022 there were 49,893. The difference is 15%. This wave has also been noticed by brokers Mortgages: Trioteca has seen how its clients tripled in the second quarter of the year the requests to subrogate the mortgage loan. And the month with the highest activity was in June, which anticipates that the trend continued in July.
In the first five months of the year, mortgage change requests have increased by 15%
Historically, mortgage changes occur more in times of crisis, when clients find that they cannot meet the payments. Thus, the data for the first five months of the year are clearly higher than those for the years 2018 (31,645) and 2019 (28,881), but are lower than those for 2021 (116,730) and 2022 (70,267), when they shot up due to the impact of the pandemic. Maria Armas, a member of the board of the Notarial College of Catalonia, explains that these months are also noticing “a slight slowdown in the signing of mortgages, possibly due to the increase in interest rates.”
In the last year, the ARA has been explaining how Putin’s invasion of the Ukraine would lead to this situation of straits in the domestic economies: the war triggered energy prices and dragged down inflation as a whole, which skyrocketed; To deal with it, the central banks of the world have reacted by raising the price of money at a rate never seen before; and with the rise in the price of money, the consequent setback in the installments of home buyers who did not have a fixed-rate mortgage.
In an average mortgage, the increase in the cost of the fee in the last year and a half is already 450 euros per month
To deal with this situation, there is a way that is still relatively unknown: renegotiate the conditions with the same entity (and carry out a novation of the loan) or take the mortgage to another bank (what is known as a subrogation). To obtain the best proposals, it is advisable to resort to brokers mortgage companies (companies such as the Catalan Trioteca, Idealista Hipotecas, and Ahorro y Rastreator), which have much better information and offers than what an individual will find by visiting bank branches or consulting the conditions of banks on the Internet.
It should be remembered that between January 2022 and the present, the Euribor has shot up from -0.5% then to 4% today. In a typical mortgage (with 200,000 euros of capital and a 30-year term), this is equivalent to a 450-euro increase in the fee once the mortgage is updated (normally this occurs semi-annually or annually). To deal with this rise, the preferred option for clients is mixed mortgages, which guarantee a fixed rate for a few years and then move to variable rates. According to data from Trioteca, this option has multiplied by seven in one year, and in July the mixed ones were 43.6% of all those signed.
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